This disclosure relates generally to bill payment.
In a conventional payment by personal check, the payor writes and delivers a check drawn on the payor's account at the payor's bank to the payee, and the payee deposits the check with the payee's bank. The payee's bank forwards the check to the payor's bank, and after the check clearing cycle the payee's account is credited and the payor's account is debited. In a conventional payment by direct deposit, also termed a giro, the payor instructs the payor's bank to transfer funds directly to the payee's account at the payee's bank.
There are two general models of electronic billing. In the direct biller model, a consumer makes a payment to a biller, e.g., a utility company, at the biller's website, e.g., by a credit card payment or an electronic debit. In the bank aggregator model, the customer uses his or her bank's website (or an aggregator or consolidator website), to authorize payment to a biller. Assuming that the biller can receive electronic payment, then the bank aggregator model operates similarly to the direct deposit model, in that on instruction by the customer to make a payment, the customer's bank can transfer funds electronically directly to the biller's bank. However, where the biller is not prepared to receive electronic payments, the customer's bank can usually generate and mail a paper check.
Printing of the paper check is conventionally done either by the customer's bank, or outsourced to a check printing service provider. Where the printing is outsourced to a check printing service provider, the customer's bank assembles data for multiple transactions (e.g., payee name and address and amount of check) into an electronic file, e.g., a spreadsheet, and transmits the file to the check printing service provider by electronic mail over the Internet, by virtual private network over the Internet, or by a modem-to-modem connection. For example, such a file might be assembled and transmitted at the end of each business day. The files are typically encrypted, e.g., with Pretty Good Privacy (PGP), when transmitted to the check printing service provider.